Chapter Two

Linear programming

Department

Management
Learning objectives

• Structure of LPM

• Assumptions of LPP

• Formulating LPPs

• Methods: Graphical and Simplex

• Special cases in LPPP

• Post-optimal analysis: Dual and sensitivity Analysis

 History of LP

• LP
• developed by the Russian mathematician L. V. Kantorovich in 1939 and

• extended by the American mathematician George. B. Dantzig in 1947 at

air force.

• The original name

• "programming in a linear structure," which was later shortened to "linear
programming."

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 Meaning of LP
• LP is a mathematical technique for choosing the best alternative
from the set of feasible alternatives.
• Is an optimization technique where the objective function and the constraints
of the problem are all linear.

• Applied to solve linear programs.

• Is a field of management science/OR that finds most efficient way of

using limited resources to achieve the objectives of a business.

Optimization
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 Structure of linear programming problems

• Decision variables – unknowns

X1 , X2 , X3 , … , Xn
e.g. the quantities of different products
Index n = the number of product types

• Constraints – limitations
• a less than or equal to constraint : f(X1 , X2 , X3 , … , Xn) < b
• a greater than or equal to constraint : f(X1 , X2 , X3 , … , Xn) > b
• an equal to constraint : f(X1 , X2 , X3 , … , Xn) = b

• Objective
• MAX(or MIN) : f(X1 , X2 , X3, …, Xn)
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Structure …

MAX(or MIN) : f(X1 , X2 , X3 , … , Xn)

Subject to:
f(X1 , X2 , X3 , … , Xn) < bm

f(X1 , X2 , X3 , … , Xn) > bm

f(X1 , X2 , X3 , … , Xn) = bm

note : n variables , m constraints

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 Requirements For Application Of LP

1. The objective should be stated in mathematical terms.

2. The activities involved should be represented in quantitative terms.

3. Limited availability of resources/ constraints should be clearly spelt out.

4. The r/ships b/n the objective function and the resource limitation
consideration must be linear in nature.

5. Feasible alternative courses of action should be available to the decision

makers that are determined by the resource's constraints.

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ASSUMPTIONS UNDERLYING LINEAR PROGRAMMING

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 Model formulation
• A linear programming model consists of certain common components and
characteristics.

• Components of LPM:

✓Decision variables,

✓Objective function which consists d/t DV and parameters

✓Model constraints,

Decision variables are mathematical symbols that represent levels of activity by the
firm.
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STEPS IN FORMULATION OF LP PROBLEMS

There are three basic steps in formulation of LPM

Step 1 : define the decision variables

how many x1, x2, x3……xn to produce

Step 2 : define the objective function

maximize profit or minimize a cost

Step 3 : define the constraints

resources available to produce something

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 A maximization model example

• XYZ Company is a small crafts operation run by an American natives. The

company employs skilled artisans to produce clay bowls and mugs with
authentic Native America designs and colors. The two primary resources
used by the company are special pottery clay and skilled labor. Given these
limited resources, the company desires to know how many bowls and mugs
to produce each day in order to maximize profit.

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 Cont’d..

The two products have the following resource requirements for

production and profit per item produced (i.e., the model parameters):

Resource Requirements
Required:
product Labor Clay (lb/unit) Profit/unit formulate
(hr/unit) linear model
Bowl 1 4 40
Mug 2 3 50

There are 40 hours of labor and 120 pounds of clay available each day
for production.

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 Summary of LP Model Formulation Steps
Step 1.
Define the decision variables

How many bowls and mugs to produce

Step 2.
Define the objective function

Maximize profit

Step 3. Define the constraints

The resources (clay and labor) available

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 Solution
o Decision Variables

how many bowls and mugs to produce

X1: numbers of bowls to produce

X2: numbers of mugs to produce

o The Objective Function

maximize Z = $40x1 + 50x2
maximize total profit
Where,
Z= total profit per day
$40X1= profit from bowls
$50X2= profit from mugs

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Completed model

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 Activity 1

• DeReal wood co., produces wooden soldiers and trains. Each soldier sells for $27,
uses $10 of raw materials and takes $14 of labor& overhead costs. Each train sells
for $21, uses $9 of raw materials, and takes $10 of overhead costs. Each soldier
needs 2 hours finishing and 1 hour carpentry; each train needs 1 hour finishing and
1 hour carpentry. Raw materials are unlimited, but only 100 hours of finishing and
80 hours of carpentry are available each week. Demand for trains is unlimited; but at
most 40 soldiers can be sold each week.

• Formulate Linear programming model

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 A minimization model example

• A farmer is preparing to plant a crop in the spring and needs to fertilize a field.
There are two brands of fertilizer to choose from, Super-gro and Crop-quick.
Each brand yields a specific amount of nitrogen and phosphate per bag, as
follows: Chemical contribution
Brand Nitrogen (lb/bag) Phosphate (lb/bag)
super-gro 2 4
Crop-quick 4 3

The farmer's field requires at least 16 pounds of nitrogen and 24 pounds of phosphate. Super-gro
costs $6 per bag, and Crop-quick costs $3. The farmer wants to know how many bags of each
brand to purchase in order to minimize the total cost of fertilizing.
• Formulate a LPM
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Summary of LP Model Formulation Steps

Step 1.
Define the decision variables

How many bags of Super-gro and Crop-quick to buy

Step 2.
Define the objective function

Minimize cost

Step 3. Define the constraints

The field requirements for nitrogen and phosphate

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 Contd
• Decision Variables

• x1 = bags of Super-gro

• x2 = bags of Crop-quick

The Objective Function

• minimize Z = $6x1 + 3x2

where

• $6x1 = cost of bags of Super-gro

• $3x2 = cost of bags of Crop-quick

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 Activity 2
• DeReal makes luxury cars and jeeps for high-income men and
women. It wishes to advertise with 1 minute spots in comedy
shows and football games. Each comedy spot costs 50birr and is
seen by 7M high-income women and 2M high-income men.
Each football spot costs 100birr and is seen by 2M high-income
women and 12M high-income men. How can DeReal reach 28M
high-income women and 24M high-income men at the least cost.

• Required: formulate a LPM

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 Solution of Linear Programming Problems

• The linear programming problems can be solved to determine

optimum strategy by two methods-
• Graphical and

• Simplex method.

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 LP:
Graphical method
 GRAPHICAL METHOD

• Graphical method is suitable when there are only two decision

variables.

• Models with three decision variables can be graphed in three

dimensions, but the process is quite cumbersome, and

• models of four or more decision variables cannot be graphed at all.

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 STEPS IN GRAPHICAL METHOD

Step I. Formulate the LP Problem as explained in previous examples.

Step II. Convert the inequalities in to equalities to obtain graphical form of the

constraints.
(Draw the line of each constraint, first putting x1=0 to find the value of x2 and then putting

x2=0 to find the value of x1. Then draw the line for the values of x1 and x2 which represents

the particular constraint. Once the lines are drawn for all the constraints, identify the feasible

polygon (area) by shading the area below the line for the constraint < and shading above the

line for the constraint > type).

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 Contd

Step III. Identify the extreme points of the feasible polygon and name the
Corners.

Step IV. Evaluate the objective function Z or C for all points of feasible region.

Step V. In case of maximizing objective function Z, the corner point of feasible

region giving the maximum value of Z becomes the value of decision variables.
Similarly in minimizing case, the point of minimum value of C gives the answer.

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 Example 1 (problem of Maximizing Z)

• Two commodities P1 and P2 are to be produced. The profit Margin on P1 is $ 8 and

on P2 is $ 6. Both the commodities are required to be processed through two
different machines. Sixty hours of time are available on I machine and forty eight
hours of time are available on II machine. One unit of P1 requires 4 hours of time
in machine I and 2 hours of time on machine II. Similarly, one unit of P2 requires 2
hours of time on machine I and 4 hours of time on machine II. Determine the
number of units of P1 and P2 to be produced in order to maximize the profits using
graphical method?

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 solution
Step I. Formulate LP Problem.
The information available can be put into structural matrix form as follow.
Commodities
Requirement Total
P1 P2
Machine I 4 2 60
Machine II 2 4 48
Profit $ per unit 8 6 -

Let x1 be number of units to be produced for P1

DV
Let x2 be number of units to be produced for P2
X1 and X2 are unknown decision variables.
Max Z= 8x1 + 6x2 Objective Function
st: 4x1 + 2x2 < 60
Resource constraints
2x1 + 4x2 < 48
x1, x2 > 0 non-negativity condition.
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 contd
Step II. Convert constraint inequalities in to equalities, draw respective lines and

determine feasible polygon (area).

• Taking constraint (i)

4x1 + 2x2 = 60 X1 X2 ∴ 4x1= 60 or x1 =15

0 30
15 0 ∴ 2x2 = 60 or x2 = 30

By these coordinates (15,30) we get line BD in graph. Similarly, taking constraint (ii).

2x1 + 4x2 = 48 X1 X2
0 12
24 0 ∴ 2x1= 48 or x1 =24

∴ 4x2 = 48 or x2 = 12

• By these coordinates (24,12) we get line AE in graph. [email protected]

 Cont’d

• Now, any point on line BD satisfies (i) constraint and any point on line
AE satisfies (ii) constraint. The constraints cannot be violated, they
must be satisfied. Any solution which satisfies all the know constraints
is called optimal solution. Since both the constraints are of the type <
hence any point on the right hand side (RHS) of BD or AE becomes
infeasible area/solution for which we are not concerned.

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Contd

Feasible
Feasible
region
region D

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 Cont’d…

• Step III. Both the constraints are to be satisfied simultaneously,

therefore, OACD becomes the region of feasible solution. This is also
known as feasible polygon.
• On line OA, point A give maximum profit, on line OD, point D gives maximum
profit.

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contd

Step IV. Evaluate the objective function Z= 8x1 + 6x2 for all points of
feasible region i.e. O,A,C,D.

At point O profit is zero ∴ Z=O

At point A x2=12, x1=0 ∴ Z=12x6=72

At point D x1=15, x2=0 ∴ Z=15x8=120

At point C x1=12, x2=6 ∴ Z=12x8+6x6=132

(from graph)

Step V. Z is maximizing objective function, hence the point with maximum

value of Z is the optimal solution point.
• Therefore at point C (Z=132) with x1=12 and x2=6 is the optimal point.

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 How to solve LPP using LINGO

Download Open new and put your

and install LPM here
LINGO on
your
computer Go to solver or

Ctrl+U

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 A maximization model (activity 3)

• XYZ Company is a small crafts operation run by an American natives.

The company employs skilled artisans to produce clay bowls and
mugs with authentic Native America designs and colors. The two
primary resources used by the company are special pottery clay and
skilled labor. Given these limited resources, the company desires to
know how many bowls and mugs to produce each day in order to
maximize profit.

• The two products have the following resource requirements for

production and profit per item produced (i.e., the model parameters):

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Cont’d…
Resource Requirements

product Labor (hr/unit) Clay (lb/unit) Profit/unit

Bowl 1 4 40
Mug 2 3 50

• There are 40 hours of labor and 120 pounds of clay available each day
for production.

Required: formulate linear model, solve graphically, find

the optimum point

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LP: Cost Minimization

• A minimization problem minimizes the value of the objective

function rather than maximizing it.

• Minimization problems generally involve finding the least-cost way

to meet a set of requirements.

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Problem of Minimizing C

Minimize C= 50x1 + 20x2

Subject to
2x1 – x2> 0
x1 + 4x2 > 80
0.9x1 + 0.8x2 >40
Where x1 ,x2 > 0 non- negativity condition.

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 Solution:

• The first step is skipped as LP problem is already formulated. We will

follow other steps simultaneously. In constraint (i) 2x1 –x2 > 0 there is
no constant value, hence it must pass through the origin. First convert it
into equality.

2x1 –x2 > 0 . Now give x1 any arbitrary value.

When x1 =0, x2=0

x1 =1, x2=2

x1 =2, x2=4 and so on.

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 contd

• We draw the line with these coordinates and get line I drawn in the graph passing through origin.
• Now, convert constraint (ii) in equality
x1 + 4x2 = 80
When x1 =0, x2=20
X2 =0, x1=80
• We draw the line II (80, 20) as shown in graph.
• Now, convert constraint (iii) in equality
0.9x1 + 0.8x2 =40
• When x1 =0, x2=50
X2 =0, x1=44.4
• We draw line III (44.4, 50) as shown in graph.

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contd

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 contd

• For feasible area we need to examine all the there constraints equations (Note, all
are > type)

• In equation (i) if we move vertically upward, meaning x1=o and x2 increasing, the
equation becomes negative or less than, which is not permitted. Hence feasible
area should be on RHS.

• In equation (ii), the feasible area should be above the line because it is greater
than the sum of x1 and x2.

• Similarly in equation (iii) it is on the RHS therefore feasible area (region) is

indicated by three rows or shading and extends upto infinity.

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 Contd
• Now we have to find out different values of Z at different corner points, B,C,E by
finding out their coordinates (x1, x2) then putting them in objective function Z.
The point which gives the minimum value is the answer.

At corner B x1=16,x2=32 therefore Z= 1440

At corner C x1=34.4,x2=11.4 therefore Z= 1948

At corner E x1=80,x2=0 therefore Z= 4000

From the above we can see that minimum value of Z is at point B where x1=16 and
x2 =32 and hence it is the answer.

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Activity 4
feeding farm animals.
• Animals need:
• 14 units of nutrient A, 12 units of nutrient B, and 18 units of nutrient C.
Two feed grains are available, X and Y.
• A bag of X has 2 units of A, 1 unit of B, and 1 unit of C.
• A bag of Y has 1 unit of A, 1 unit of B, and 3 units of C.
• A bag of X costs $2. A bag of Y costs $4.
• Required: 1. Minimize the cost of meeting the nutrient requirements.
2. Solve the problem graphically
3. Find the optimal solution in the graph

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 Answer
Min C = 2x1+4x2
Feed Nutrients cost
st: 2x1+x2>= 14 grains A B C
x1+x2>= 12
X 2 1 1 2
x1+3x2>= 18
Y 1 1 3 4
x1+x2>= 0
Total 14 12 18
needs

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Change inequalities in to equalities

X1 X2 X 1 X2
0 14 X1 X2
0 12
7 0 12 0 0 6
18 0

(7, 14) (12, 12) (18, 6)

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Plot the graph Calculate the cost
X2
and identify the
14 A 2X1+X2= 14 optimum corner
12

10
2X1+X2= 14
B
8

6 Feasible region

4 C
2X1+X2= 14
2
D
0 X1
2 4 6 8 7 10 12 14 16 18

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Solve this on excel
• Max Z = 10x1+50x2+20x3
• st: 2x1+3x2+x3<=40
• x1+x2+x3<= 30
• x1-2x2>=0
Simplex method

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Simplex method of solving LP
• When a large number of variables (more than 2) are involved in a problem,
the solution by graphical method is difficult/ not possible.
• The simplex method provides an efficient technique which can be applied for solving
LPPs of any magnitude, involving two or more decision variables.

• In this method, the objective function is used to control the development and evaluation
of each feasible solution of the problem.

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 Cont’d…
• The simplex Algorithm is an iterative procedure for finding, in a systematic
manner, the optimal solution that comes from the corner points of the feasible
region.
• Simplex algorithm considers only those feasible solutions which are provided by the
corner points and that too not all of them.

• It is very efficient algorithm.

• The technique also has the merit to indicate whether a given solution is optimal or not.

• Was formulated by G.B. Dantzig in 1947.

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 Cont’d…

• For application of simplex method, following conditions must be satisfied.

• Right Hand Side (RHS/ or Q) of each constraint should be non-negative. In

case of negative RHS, the whole solution (inequality) to be multiplied by-1.

• Each of the decision variables of the problem should be non-negative. In case

of ‘unrestricted’ variables it is treated as the difference of two non-negative
variables-such as xl, x2 > 0, x3 unrestricted can be written as xl, x2, x4, x5 > 0,
where x3 = x4 –x5 , After the solution is reached, we substitute difference of x4
and x5 as x3.

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 Basic terms in simplex

1. Standard Form: represents the linear relationships of objective function and

constraints, making RHS of constraints as equal produces standard form
(converting inequality (canonical form) into standard form).

2. Slack and Artificial Variables:

are designated as S1, S2 . . . . etc. and A1, A2 etc. respectively.

• slack variables indicate spare capacity of the constraints,

• artificial variables are imaginary variables added for standard form.

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Cont’d…

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 Cont’d…

6. Simplex Table:

A table used for calculations during various iterations of the simplex procedure, is called
Simplex table.

7. Variable Mix:

The values of the column that contains all the variables in the solution.

8. Basis:

The set of variables which are not set to zero and figure in the column of "Product Mix" are
said to be in the 'Basis'.

9. Iteration:

steps of moving from one solution to another to reach optimal solution are called Iterations.

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 Cont’d…
10. Cj Row:

It is the row containing the coefficients of all the variables (decision variables, slack
or artificial variables) in the objective function.

11. Constraints:

Restrictions on the problem solution arising from limited resources.

12. Cj - Zj = ∆j or Index Row:

The row containing net profit or loss resulting from introducing one unit of the
variable in that column in the solution.

A +ve number in the ∆j row would indicate an algebraic reduction or increment

in the objective function if one unit of the variable of that column is introduced in
the basis.

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 Cont’d…

13. Pivot -Column:

• The largest +ve number in Cj - Zj row in a maximization problem or

• The smallest number in a minimization problem

• Indicates entering variable.

14. Pivot Row:

• The smallest +ve value of the ratio will be outgoing/leaving variable and replaced
by the entering variable.

• The row with least ratio is called Pivot row

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 Cont’d…

15. Pivot Element:

The element at the point of intersection of the key column and the key row is
called the Pivot element.

16: Optimal Solution:

The best of all feasible solutions.

17: Linear Function:

A mathematical expression in which a linear relationship exists amongst various
variables.

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 Standard form of simplex method
To apply a simplex technique, LPP must be formulated as follow
Objective Function
• Optimize (Maximise or minimise) Z = C1 x1 + C2 x2 + . . .+ Cn xn
• where Cj (j = 1,2,. . . . . . . . . n) are called profir/cost coefficients.
• Constraints (linear)
St: a11 x1 + a12 x2 + a1n xn = b1
a21 x1 + a22 x2 + a2n xn = b2
aml x1+ am2 x2 + amm xn = bm.
Where bi (i = 1, 2…m) are resources constraints and
constants aij (i = l,2,….m; j = 1,2,…..n ) are called the input output coefficients.

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 Slack and Artificial variables :
To solve LPP, first inequalities must be converted into equalities

• For constraints with < , slack variables or unused resources (S1, S2. . . Sn ) will be added.

• The slack variables contribute nothing towards the objective function and hence their
coefficients in the objective function are to be zeros.

• Thus, to illustrate the above concept,

• Constraints ailxl + ai2x2. . . . .ainxn < bi ; i = 1,2,. .m (Canonical form)

• Can be written as ail x1….ain xn + Si = bi ; i = 1,2,. . M (Standard form)

And the objective function can be written as

• Max. or Min. Z = c1 x1 + c2 x2 + . . . . . cn xn + 0S1 + 0S2 + ......

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 Cont’d…
• Similarly, for the constraints of the type ≥, the addition of slack variables has to be
in the form of subtraction. Thus, equation of constraints can be written as

• ai1 x1 + ai2 x2 +….ain xn - Si = b I ; i = 1,2, …….m

• To bring it to the standard form, we add another variable called artificial variable
(Ai), as follows:

• ai1 x1 +ai2 x2 +. . . . . . . ainxn- Si + Ai = bi ; i = 1, 2, 3,. . . . . . . . m

• This is done to achieve unit matrix for the constraints. But artificial variables
cannot figure in the solution as there are artificially added variables and have no
significance for the objective function. These variables, therefore, are to be
removed from the solution.
 Standardization/Tableau Form/

Types of constraint Standard form

≤ Add a slack variable

= Add an artificial variable

≥ subtract a surplus variable and add an artificial variable

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Steps in Simplex Method

2. Develop an initial simplex tableau

1. Write the problem in standard form:
Steps in developing initial simplex

Characteristics: tableau:
▪ All constraints are expressed in the form of equalities or
i. List the variables in the model across the top of the
equations. tableau
▪ All right hand sides are non-negative ii. Next fill-in the parameters of the model in the

▪ All variables are non-negative appropriate rows and columns

iii. Add two columns to the left side of the tableau. The
first column is a list of variables called ‘Basis’.

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 Cont’d…
iv. The Cj at the top second column indicates that the values in that column and the
values in the top row are objective function coefficients.

v. The last column at the right is called the quantity column. It refers to the right hand
side values (RHS) of the constraints.

vi. There are two more rows at the bottom of the tableau. The first raw is a Zj-row. For
each column the Zj – value is obtained by multiplying each of the number of the column
by their respective row coefficient in column C. The last row is Cj-Zj row.

The values in this row are also calculated column

by column. For each Column, the value in row Zj
is subtracted from the Cj value in the top row.

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 Cont’d…
3. Interpreting the initial simplex tableau

4. Determining the entering variable:

• For a maximization problem; the entering variable is 5. Determining the leaving variable:
• the leaving variable is identified as the one with the
identified as the one which has the largest positive value in
Cj-Z row. The column which corresponds to the entering smallest non-negativity ratio for quantity divided
by respective positive pivot columnar entries. The
variable in the simplex tableau is called pivot column.
row of the leaving variable is pivot row.
• In a minimization problem, the entering variable is identified 6. Make the entering variable basic and the leaving
as the one which has the largest negative Cj-Z row value in non-basic by applying elementary row operations of

the simplex tableau. matrix algebra.

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7. Iteration for improved solution: (d) The same procedure is
(a) Replace outgoing variable with the entering variable and followed for modification to bi
enter relevant coefficients in Zj column. column also.
(b) Compute the, Pivot row with reference to the newly (e) Having obtained the revised
entered variable by dividing the old row quantities by the key
simplex table, evaluate ∆j = Cj -
element.
Zj and test for optimality as per
(c) new values for the other rows. In the revised simplex
step 3 above.
table, all the other rows are recalculated as follows.

New row elements= Elements in the old row - [corresponding

key column element multiplied by the corresponding new
element of the revised row at (b) above.]
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8. Check for optimality

Remark: A simplex solution for a maximization problem is optimal if and only if cj – z row contains only zeros and negative value (i.e. if
there are no positive values in the cj – z row).

• The simplex solution for a minimization problem is optimal if Cj-Z row contains only zero
and positive values (Cj-Z ≥ 0).

(a) Obtaining Optimal Solution- If the table indicates optimality level by examining ∆j or
index row, the iteration stops at this point and values of bi's for corresponding variables in
the product mix column will indicate the values of the variables contributing towards the
objective function. The value of the objective function can be then worked out by
substituting these Values for corresponding decision variables.

• (b) If the solution is not optimal, proceed to Step 9.

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9. Revise or improve the Solution-For this purpose, we repeat Step 4 to
Step 7 till optimality conditions are fulfilled and solution is obtained.

• Rule for Ties. Whenever two similar values are encountered in index
row or ratio column, we select any column or ratio, but to reduce
computation effort, following can be helpful.

(a) For key column, select the left most tie element.

(b) For ratio, select nearest to the top.

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• The artificial variables in a minimization problem will be expressed
in the objective function with a large positive coefficient so that they
are quickly eliminated as we proceed with the solution.

Note that: if the solution is not optimal the steps will be repeated again
and again until the optimal solution is obtained!

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Simplex Algorithm-Maximization Problem

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A. Simplex Algorithm-Maximization Problem

• Solve the following problem by simplex method.

Max. Z = 8x 1 + 16x2
Subject to, x1 + x2 < 200
x2 < 125
3x1 + 6x2 < 900
x1, x2 > 0

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 Solution
• We convert the inequality into equations by adding slack variables. Above statements can thus be
written as follows.
x1 + x2 + S1 = 200
x2 + S2 = 125
3x1 + 6x2 + S3 = 900 and
x1, x2, S1, S2, S3 > 0.
where S1,S2, S3 are slack variables and objective function is re-written as: Max. Z = 8x1 + 16x2
+ 0S1 + 0S2 + 0S3
Now there are five variables and three equations and hence to obtain the solution, any two
variables will have to be assigned zero value. Moreover, to get a feasible solution, all the constraints
must be satisfied.
• To start with, let us assign x1 = 0; x2 = 0 (Both decision variables are assigned zero values) Hence,
S1 = 200, S2 = 125, S3 = 900 and Z=0

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 This can be written as initial simplex table 1

Unit Cj 8 16 0 0 0 Ratio
profit
BV Q X1 X2 S1 S2 S3 Q/aij
(Zj)

0 S1 200 1 1 1 0 0 200/1=200
0 S2 125 0 1 0 1 0 125/1=125 LV

0 S3 900 3 6 0 0 1 900/6= 150

Zj 0 0 0 0 0 0
Cj-Zj 8 16 0 0 0

EV
Key No.
Where: EV= entering variable (Key column)
LV= leaving variable (key row)
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• Entering variable

Since Cj - Zj is maximum at 16, i.e., profit is more for each unit for x2 variable, we
introduce x2 into the solution. It is the marked as key column and x2 becomes the
entering variable. Dividing Quantities (bi's) by the corresponding key elements of
each row, we obtain the ratio (Q/aij) column such as for row S1, it is 200 ÷ 1 = 200,
S2= 125 and S3=150.

• Leaving variable

The leaving variable is, the row which has least ration (Q/aij), here, S2 has 125 ratio
which small compare to other BV, it will be replaced by X2.

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 • Now each of the elements of the Key row is divided by Key element to
get x2 row in the new table. Thus we get the key row as follows:
Unit profit Q X1 x2 S1 S2 S3
16 125/1 0/1 1/1 0/1 1/1 0/1
125 0 1 0 1 0

In order to obtain the corresponding values of the table, we follow

the relationship as follows:
New row= old row – corresponding coefficient new tableau
in pivot column X row value
Q X1 X2 S1 S2 S3

For S1, 200- 1-(1x0)=1 1-(1x1)=0 1-(1x0)=1 0-(1x1)=-1 0-(1x0)=0

row (1x125)=75

For S3 900- 3-(6x0)=3 6-(6x1)=0 0-(6x0)=0 0-(6x1)=-6 1-(6x0)=0

row (6x125)=150

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Arranging these values into the simplex table, we obtain:

revised simplex table II

Zj Cj 8 16 0 0 0
variable Q x1 x2 s1 s2 S3
0 S1 75 1 0 1 -1 0
16 X2 125 0 1 0 1 0

0 S3 150 3 0 0 -6 1
Zj 2000 0 16 0 16 0
Cj-Zj 8 0 0 -16 0

Since the Cj-Zj row is contains positive value it is not optimal,

as a result we have to revise the tableau to reach the optimal
solution
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 Lets identify the Ev and Lv
Zj Cj 8 16 0 0 0 Q/aij
variable Q x1 x2 s1 s2 S3
0 S1 75 1 0 1 -1 0 75/1=75
16 X2 125 0 1 0 1 0 125/0=∞

0 S3 150 3 0 0 -6 1 150/3=50
Zj 200 0 16 0 16 0
0
Cj-Zj 8 0 0 -16 0

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 • Now each of the elements of the Key row is divided by Key element to
get x2 row in the new table. Thus we get the key row as follows:
Unit profit Q X1 x2 S1 S2 S3
8 150/3 3/3 0/3 0/3 -6/3 1/3
50 1 0 0 -2 1/3

In order to obtain the corresponding values of the table, we follow

the relationship as follows:
New row= old row – corresponding coefficient new tableau
in pivot column X row value
Q X1 X2 S1 S2 S3

For S1, 75-(1x50)=25 1-(1x1)=0 0-(1x0)=0 1-(1x0)=1 -1-(1x-2)=1 0-(1x1/3)=

row -1/3

For X2 125-(0x50)= 0-(0x0)=0 1-(0x1)=1 0-(0x0)=0 0-(0x-2)=0 0-(0x1/3)

row 150 =0

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Arranging these values into the simplex table, we obtain:

revised simplex table III

Zj Cj 8 16 0 0 0
variable Q x1 x2 s1 s2 S3
0 S1 25 0 0 1 1 -1/3
16 X2 125 0 1 0 1 0

8 X1 50 1 0 0 -2 1/3
Zj 2400 8 16 0 0 8/3
Cj-Zj 0 0 0 0 -8/3

Now, all the values of ∆j being zero or negative, suggesting that the solution
is optimal and Z = 2,400 for x1 = 50 and x2 = 125. S1 indicates surplus.

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Activity 5

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SOLUTION
6 2 34 0 0 0
BV Q Q/ai
j
0 60 1 2 2 1 0 0 60
0 90 3 1 1 0 1 0 30
0 80 2 1 2 0 0 1 40
0 0 0 0 0 0
6 2 4 0 0 0

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SOLUTION
6 2 4 0 0 0
BV Q Q/ai
j
0 30 0 1 0

6 30 1 0 0

0 20 0 0 1

180 6 2 2 0 2 0
0 0 2 0 -2 0

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SOLUTION
6 2 4 0 0 0
BV Q Q/ai
j
0 30 0 1 0 30

6 30 1 0 0 90

0 20 0 0 1 15

180 6 2 2 0 2 0
0 0 2 0 -2 0

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SOLUTION
6 2 4 0 0 0
BV Q Q/ai
j
0 5 0 0 1

6 25 1 0 0

4 15 0 1 0

210 6 4 0 1

0 -1 0 -1

Optimum

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Activity 6

• Maximize Z = 3x1 + 4x2

Subject to, 3x1 + 6x2 < 120
8x1 + 5x2 < 60
3x1 + 4x2 < 50
x1, x2 > 0

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 Class work
Maximise Z = 10x1 + 15 x2 + 20 x3
S.T.
10 x1+ 5x2 + 2x3 ≤ 2,700
5x1 + 10x2 + 4x3 ≤ 2,200
1x1 + 1x2 + 2x3 ≤ 500 and
All 1x,x2 andx3 are ≥ 0

Maximise Z = 10x1 + 15 x2 + 20 x3 +0S1+0S2+0S3

S.T
Solution ; S1 1600
10 x1+ 5x2 + 2x3 +S1 = 2700
5x1 + 10x2 + 4x3 + S2 = 2200 X2= 150
1x1 + 1x2 + 2x3+S3 = 500 X2= 174.4
x1, x2 and x3 all ≥ 0
Profit= 5738
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Simplex Algorithm- Minimization
problem

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 B. Simplex Algorithm- Minimization problem
• Some of the important aspects of minimization problem

1. Artificial variables have no economic significance

• Introduced only to bring in the standard form of simplex method.

• Need be removed from the solution as soon as they become non-

basic.

2. Since these variables are added for computation purpose

only, ensure their zero value in the optional solution.

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This can be done by assigning very large penalty (+M) for Big M-Method
a minimisation problem, so that these do not enter the
In this method, we assign the
solution.
coefficients of the artificial
3. If artificial variables cannot be removed from the
variables, as a very large positive
solution, then the solution so obtained is said to be Non-
Feasible. This would indicate that the resources of the
penalty i.e., +M therefore called
system are not sufficient to meet the expected demand. Big M-method.

4. Equality Constraints also can be handled by using

artificial variables to obtain initial solution.

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• The Big M-method for solving LP problem can be adopted as follows:

Step 1 : The standard simplex table can be obtained by adding surplus

and artificial variables.

• Surplus variables are assigned zero coefficients and artificial variables

assigned +M coefficients in the objective function.

Step 2: We obtain initial basic feasible solution by assigning zero value to

the decision and surplus variables.

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Step 3: Initial basic feasible solution is obtained Step 4: Determine the key row as in
in the form of the simplex table as above and then case of maximisation problem i.e.,
values of ∆j = Cj - Zj are calculated.
selecting the lowest positive value of
✓If ∆j ≥0, then the optimal solution has been
the ratio Q or bi/aij, obtained by
obtained.
dividing the value of quantity bi by
✓If ∆j< 0, then we select the largest negative
corresponding element of the key
value of ∆j and this column becomes the key
column.
column indicating the entering variable.

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• Step 5: Repeat steps 3 and 4 to ensure optimal If at least one artificial variable is
solution with no artificial variable in the solution.
present in the basis with positive
If at least one artificial variable is present in the
basis with zero value and coefficient of M in each value, and coefficient of M in each Cj
Cj - Zj values is negative, the LP problem has no - Zj values is non-negative, then LP
solution. This basic solution will be treated as
problem has no optimal basic
degenerate.
feasible solution. It is called pseudo-
• A tie for the pivot row is broken arbitrarily and
optimum solution.
can lead to degeneracy.

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 Example
• Food A contains 20 units of vitamin X and 40 units of vitamin Y
per gram. Food B contains 30 units each of vitamin X and Y. The
daily minimum human requirements of vitamin X and Y are 900
and 1200units respectively. How many grams of each type of
food should be consumed so as to minimise the cost, if food A
costs 60 cents per gram and food B costs 80 cents per gram.

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 Solution:
• LPP formulation is as follows
Min. Z = 60x1+ 80x2 (Total Cost)
Subject to, 20x1 + 30x2 > 900 (Vitamin X Constraint)
40x1 + 30x2 > 1,200 (Vitamin Y Contraint) and x1, x2 > 0

• Adding slack and artificial variables, we get

Min. Z = 60x1 + 80x2 + 0S1 + 0S2 + MA1 + MA2

Subject to, 20x1 + 30x2 – S1 + A1 = 900

40x1 + 30x2 - S2 + A2 = 1,200

and x1, x2, S1, S2, A1, A2 > 0

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 Initial non-optimal solution is written as follows:

simplex table I
Zj Cj 60 80 0 0 M M Ratio
BV Q x1 x2 s1 s2 A1 A2
M A1 900 20 30 -1 0 1 0 45
M A2 1200 40 30 0 -1 0 1 30

Zj 2100M 60M 60M -M -M M M

Cj-Zj 60-60M 80-60M M M 0 0

Since ∆j = 60 – 60M is the lowest, x1 becomes the

entering variable, similarly Ratio bi/aij = 30 is lowest
positive value, hence it goes out.
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Simplex table II
Zj Cj 60 80 0 0 M Ratio
BV Q x1 x2 s1 s2 A1 Q/aij
M A1 300 0 15 -1 1/2 1 20
60 X1 30 1 3/4 0 -1/40 0 40

Zj 1800+300M 60 45+15M -M -3/2+1/2M M

Cj-Zj 0 35-15M M (3-M)/2 0

Since ∆j = 35 – 15M is the lowest, x1 becomes the

entering variable, similarly Ratio bi/aij = 20 is lowest
positive value, hence it goes out.
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Initial non-optimal solution is written as follows:
Simplex table III

Zj Cj 60 80 0 0
BV Q x1 x2 s1 s2
80 X2 20 0 1 -1/15 1/30
60 X1 15 1 0 1/20 -1/20

Zj 2500 60 80 -7/3 -1/3

Cj-Zj 0 0 7/3 1/3

Since ∆j = zero and positive value, hence this is the

solution.

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Activity 7

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Activity 8
Mixed constraints

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Mixed constraints

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 Initial non-optimal solution is written as follows:

simplex table I
Zj Cj 4 2 0 0 M M Ratio
BV Q x1 x2 s1 s2 A1 A2
M A1 3 3 1 0 0 1 0 1
M A2 6 4 3 -1 0 0 1 6/4
0 S2 3 1 2 0 1 0 0 3
Zj 9M 7M 4M -M 0 M M
Cj-Zj 4-7M 2-4M M 0 0 0

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• X1= Q X1 X2 S1 S2 A2
3 3 1 0 0 0
3/3 3/3 1/3 0/3 0/3 0/3
new row= 1 1 1/3 0 0 0
• New row= old row – corresponding coefficient new tableau
in pivot column X row value

row A2, Q= 6-(4x1) = 2 S2, Q= 3-(1x1)= 2

X1= 4-(4x1)=0 X1= 1-(1x1)=0
X2= 3-(4x1/3)=5/3 X2= 2-(1x1/3)=5/3
S1= -1-(4x0)= -1 S1= 0-(1x0)=0
S2= 0-(4x0)= 0 S2= 1-(1x0)=1
A2= 1-(4x0)= 1 A2= 0-(1x0)=0

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 Revised simplex table II

Zj Cj 4 2 0 0 M Ratio
BV Q x1 x2 s1 s2 A2
4 X1 1 1 1/3 0 0 0 3
M A2 2 0 5/3 -1 0 1 6/5
0 S2 2 0 5/3 0 1 0 6/5
Zj 4+2M 4 4/3+5/3 -M 0 M
M
Cj-Zj 0 2-5M/3 M 0 0

Select near to
the top

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• X2= Q X1 X2 S1 S2
2 0 5/3 -1 0
2/5/3 0/5/3 5/3/5/3 -1/5/3 0/5/3
new row= 6/5 0 1 -3/5 0
• New row= old row – corresponding coefficient new tableau
in pivot column X row value

row X1, Q= 1-(1/3x6/5) = 9/15 S2, Q= 2-(5/3x6/5)= 0

X1= 1-(1/3x0)= 1 X1= 0-(5/3x0)= 0
X2= 1/3-(1/3x1)= 0 X2= 5/3-(5/3x1)= 0
S1= 0-(1/3x-3/5)= 1/5 S1= 0-(5/3x-3/5)=1
S2= 0-(1/3x0)= 0 S2= 1-(5/3x0)= 1

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 Optimal solution simplex table III
Zj Cj 4 2 0 0
BV Q x1 x2 s1 s2
4 X1 9/15 1 0 1/5 0
2 X2 6/5 0 1 -3/5 0
0 S2 0 0 0 1 0
Zj 72/15 4 2 -2/5 0
Cj-Zj 0 0 0 0

This is the optimal solution, with X1= 3/5

X2= 6/5
S2= 0, and
total cost= 24/5

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 Example
Min C = 2x1-3x2+6x3
st: 3x1-x2+2x3<= 7
2x2+4x2 >= -12
-4x1+3x2+8x3<=10
xi>= 0
Here all the RHS values must be Min C = 2x1-3x2+6x3
positive, therefore st: 3x1-x2+2x3<= 7
Multiply the second constraint by -1 -2x2-4x2 <= 12
Here even the inequality sign will be -4x1+3x2+8x3<=10
changed
xi>= 0
 Irregular types of LPP
• The basic simplex solution of typical maximization and minimization
problems has been shown in this chapter. However, there are several
special types of atypical linear programming problems.

• For irregular problems the general simplex procedure does not always
apply.

These special types include problems with more than one optimal
solution, infeasible problems, problems with unbounded solutions,
problems with ties for the pivot column or ties for the pivot row, and
problems with constraints with negative quantity values.

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Multiple optimal solution

40

Profit @ corner B
30

A and C is equal
20

(1200)
10

B
FR
C
10 20 30 40 50
An infeasible solution

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 Infeasible problem
The three constraints do not overlap to form a feasible solution area.
Because no point satisfies all three constraints simultaneously, there is no
solution to the problem.

X1= 4

8
D X2=6
6

B
4

4X1+2X2=8
2

A
C

2 4 6 8 10
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 An unbounded problem

• In some problems the feasible solution area formed by the model

constraints is not closed. In these cases it is possible for the objective
function to increase indefinitely without ever reaching a maximum value
because it never reaches the boundary of the feasible solution area.

• In an unbounded problem the objective function can increase

indefinitely because the solution space is not closed.

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An unbounded solution
But unlimited profits are not
possible in the real world;
unbounded solution, like an
infeasible solution,
atypically reflects an error in
defining the problem or in
formulating the model
10
8

The objective function is

6

shown to increase without

4

bound; thus, the solution is

2

FR
never reached
2 4 6 8 10
Sensitivity analysis (post optimality)

reading assignment

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Sensitivity analysis
• Carried out after the optimal solution is found

• Examination of the impacts of changes of parameters on the optimal solution.

• i.e. change of coefficient of the constraints, change of coefficient of the objective

function, change of quantity or RHS values

• Starts with the final tableau of the LPP (simplex tableau)

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Example: a change in the RHS of a constraints
• Change in RHS or Q of one constraint is considered at a time

• Consider shadow price

• Shadow price: is a marginal value; it indicates the impact that a one unit change
in the value of the constraint would have on the value of the objective function.

• Shadow prices are the values in the Z-row of slack columns

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• The LPM of the micro computer problem above is:
Max Z: 60x1+50x2
Subject to:

Assembly time: 4x1+10x2≤100

Inspection time: 2x1+x2≤22

Storage space: 3x1+3x2≤39

x1, x2≥0

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Basis Cj 60 50 0 0 0 Quantit
X1 X2 S1 S2 S3 y
S1 0 0 0 1 6 -16/3 24
X1 60 1 0 0 1 -1/3 9
X2 50 0 1 0 -1 2/3 4
Z 60 50 0 10 40/3 740

Cj-Z 0 0 0 10 -40/3

Shadow price
• From the above tableau; the shadow prices are $ 0 for S1, $10 for S2 and $40/3

for S3.

• This tells us that if the amount of assembly time was increased by one hour, there

would be no effect on profit; if the inspection time was increased by one hour, the

effect would be to increase profit by $ 10, and if storage space was increased by

one cubic foot, profit would increase by $40/3.

• In the above problem, the optimal solution was given by the intersection of
inspection time and storage space constraints.

• Thus, the shadow prices in the final simplex tableau will remain the same so long
as the same constraints give the intersection for the optimal solution.

• For what range of changes in the RHS value of those constraints the current
shadow prices remain valid? This is answered by range of feasibility.
Range of Feasibility (Right hand side range)

• The range of feasibility is the range over which the RHS value of a constraint can
be changed and still have the same shadow prices.
Range of feasibility

• The range within which resources/constraints can changed having the

proportionate change in objective value
 Steps
Step 1. compute the ratio (feasibility ratio) quantity

respective slack value = Q/S

both –ve and +ve ratio are considered

Step 2. identify the smallest +ve ratio and –ve ratio closest to zero

Step 3. find the upper limit or allowable increase and lower limit
or allowable decrease (range of feasibility)

Upper limit= the original value + negative ratio

Lower limit= the original value – positive ratio

Closest
to zero
For both max and min problems
Determine the range of feasibility for each of the constraints in the ff LPP, whose
final tableau

Cj 60 50 0 0 0
Zj Bv Q X1 X2 S1 S2 S3
0 S1 24 0 0 1 6 -16/3
60 X1 9 1 0 0 -1 -1/3
50 X2 4 0 1 0 -1 2/3
Zj 740 60 50 0 10 40/3
Cj-Zj 0 0 0 -10 -40/3
Solution
1. Recall the original value of the resources
Original value constraints S1 S2 S3
100 S1 1 6 -16/3
22 S2 0 -1 -1/3
39 S3 0 -1 2/3
2. ratio = Q/respective slack values
S1= 24/1= 24 S2= 24/6= 4 S3= 24/-16/3 = -4.5
9/0= undefined 9/-1= -9 9/-1/3 = -27
4/0= undefined 4/-1= -4 4/2/3= 6
 3. Find the range of feasibility
Constrain Original Lower limit Upper limit Range of
ts value feasibility
S1 100 100-24= 76 100+∞ 76-∞
S2 22 22-4= 18 22+4= 26 18-26
S3 39 39-6 = 33 39+4.5= 43.5 33-43.5

Therefore:

Constraint one (assembly line): 100-24 up to 100+∞= 76-∞

Constraint two (inspection time): 22-4 up to 22-4= 18-26

Constraint three (storage space): 39-6 up to 39+4.5= 33-43.5

 Interpretation
First constraint:

Each hour decrease in assembly time will decrease the current profit by Birr 0 (i.e no effect-indicated by
shadow price) as long as the decrease is up to 24 hours. But if the assembly time decreases by more than 24
hours (or if the total available assembly time is lower than 76 hours), the current shadow price will no
longer be valid. That is, the profit will be affected. But available assembly time can increase indefinitely
(=allowable increase is ∞ ) without affecting the current profit level.

Second constraint:

Similarly, Each hour increase or decrease in inspection time will increase or decrease the current profit by
$10, respectively as long as the total inspection time is between 18 and 26 hours. Out side the range of
feasibility, the current shadow price ($10) will not be valid.

Third constraint:

Each cubic feet increase or decrease in storage space results in an increase or decrease, respectively, of
profit by $13.33 (i.e 40/3) as long as the total storage space is between 33 and 43.5 cubic feet.
• Range of insignificance
S1= below zero
S2= (0-10)
S3= (0-40/3)
Determine the range of feasibility for each of the constraints in the ff LPP, whose
final tableau

Cj 60 50 0 0 0
Zj Bv Q X1 X2 S1 S2 S3
0 S1 24 0 0 1 6 -16/3
60 X1 9 1 0 0 -1 -1/3
50 X2 4 0 1 0 -1 2/3
Zj 740 60 50 0 10 40/3
Cj-Zj 0 0 0 -10 -40/3
Solution
1. Recall the original value of the resources
Original value constraints S1 S2 S3
100 S1 1 6 -16/3
22 S2 0 -1 -1/3
39 S3 0 -1 2/3
2. ratio = Q/respective slack values
S1= 24/1= 24 S2= 24/6= 4 S3= 24/-16/3= -4.5
9/0= undefined 9/-1= -9 9/-1/3= -27
4/0= undefined 4/-1= -4 4/2/3= 6
3. Find the range of feasibility

Constrain Original Lower limit Upper limit Range of

ts value feasibility
S1 100 100-24= 76 100+∞ 76-∞
S2 22 22-4= 18 22+4= 26 11-26
S3 39 39-6 = 33 39+4.5= 43.5 33-43.5

Therefore:

Constraint one (assembly line): 100-24 up to 100+∞= 76-∞

Constraint two (inspection time): 22-4 up to 22-4= 18-26

Constraint three (storage space): 39-6 up to 39+4.5= 33-43.5

Interpretation
First constraint:

Each hour decrease in assembly time will decrease the current profit by Birr 0 (i.e no effect-indicated by
shadow price) as long as the decrease is up to 24 hours. But if the assembly time decreases by more than
24 hours (or if the total available assembly time is lower than 76 hours), the current shadow price will no
longer be valid. That is, the profit will be affected. But available assembly time can increase indefinitely
(=allowable increase is ∞ ) without affecting the current profit level.

Second constraint:

Similarly, Each hour increase or decrease in inspection time will increase or decrease the current profit by
$10, respectively as long as the total inspection time is between 18 and 26 hours. Out side the range of
feasibility, the current shadow price ($10) will not be valid.

Third constraint:

Each cubic feet increase or decrease in storage space results in an increase or decrease, respectively, of
profit by $13.33 (i.e 40/3) as long as the total storage space is between 33 and 43.5 cubic feet.
Example 2. A change of coefficient of objective function

• Two cases

1. Range of insignificance

the range over which the non basic variables objective function coefficient can
change without making these variables entering in the solution

2. Range of optimality

the range over which the objective function coefficient of basic variables can
change without changing the optimal values i.e. without changing basic and non
basic variables but change the optimal function value.
Steps for range of optimality

For both max and min

problems
Example
Cj 60 50
Zj BV Q X1 X2 S1 S2 S3 Solution
0 S1 24 0 0 1 6 -16/3
• Range of
60 X1 9 1 0 0 1 -1/3
50 X2 4 0 1 0 -1 2/3 insignificant for S2 =
Zj 740 60 50 0 10 40/3 -∞ up to 10
Cj-Zj 0 0 0 -10 -40/3
• S3= ?

• Determine the range of insignificant for S2 and the

range of optimality for decision variables
 Solution

X1 Cj-Zj 0 0 0 -10 -40/3

X1 values in the tableau 1 0 0 1 -1/3 X2 Cj-Zj 0 0 0 -10 -40/3

0 1 0 -1 2/3
∞ ∞ ∞ -10 40

• Upper limit= 60+40= 100 ∞ ∞ ∞ 10 -20

• Lower limit= 60-10= 50 • Upper limit= 50+10= 60

• Range of optimality of X1(1st DV)= 50-100 • Lower limit= 50-20= 30

• Range of optimality of X2(2nd DV)=

30-60
 Duality
• The mirror image of LPP

• A given LPP has two forms

1. The Primal: the original LP Model

2. The Dual: alternative

How to convert the primal to its dual and vice versa?

Maximization objective of the primal= minimization objective of the Dual.

The primal dual relationship

2
 Example:
• The doctor advises a patient visited him that the patient is weak in his health due to shortage

of two vitamins, i.e., vitamin X and vitamin Y. He advises him to take at least 40 units of

vitamin X and 50 units of Vitamin Y every day. He also advises that these vitamins are

available in two tonics A and B. Each unit of tonic A consists of 2 units of vitamin X and 3

units of vitamin Y. Each unit of tonic B consists of 4 units of vitamin X and 2 units of vitamin

Y. Tonic A and Bare available in the medical shop at a cost of ETB 3 per unit of A and ETB

2.50 per unit of B. The patient has to fulfill the need of vitamin by consuming A and B at a

minimum cost.
• If we solve and get the solution of the primal problem, we can read the answer of
dual problem from the primal solution.

Primal problem: Dual Problem:

Min C= 3X1+ 2.5X2 Max Z= 40Y1+ 50Y2

st: 2X1+ 4X2 ≥40 St: 2x+ 3y ≤3

3X1+ 2X2 ≥50 4x+ 2y ≤2.50

X1, X2≥0 Y1, Y2 ≥0.

 Solution to primal (minimization)
CJ 3 2.5 0 0 M M
Zj Bv Q X1 X2 S1 S2 A1 A2
2.5 X2 5/2 0 1 -3/8 1/4 3/8 -1/4
3 X1 15 1 0 1/4 -1/2 -1/4 1/2
Zj 51.25 3 2.5 -3/16 -7/8 3/16 7/8
Cj-Zj 0 0 3/16 7/8 M-3/16 M-7/8
Answer: X1= 15 X2= 2.5 cost= 51.25

Solution to dual (maximization)

CJ 40 50 0 0
Zj Bv Q Y1 Y2 S1 S2
50 Y2 7/8 0 1 1/2 -1/4
40 Y1 3/16 1 0 -1/4 3/8
Zj 51.25 3 2.5 15 5/8
Cj-Zj 0 0 -15 -5/2

Answer: Y1= 3/16 Y2= 7/8 profit= 51.25

• The patient has to minimize the cost by purchasing vitamin X and Y and the shopkeeper has
to increase his returns by fixing competitive prices for vitamin X and Y. Minimum cost for
patient is ETB 51.25 and the maximum returns for the shopkeeper is ETB 51.25. The
competitive price for tonics is ETB 3 and ETB 2.50. Here we can understand the concept of
shadow price or economic worth of Resources clearly. If we multiply the original elements
on the right hand side of the constraints with the net evaluation elements under slack or
surplus variables we get the values equal to the minimum cost of minimization problem or
maximum profit of the maximization problem.
The primal dual relationship
Example:
• The doctor advises a patient visited him that the patient is weak in his

health due to shortage of two vitamins, i.e., vitamin X and vitamin Y. He

advises him to take at least 40 units of vitamin X and 50 units of Vitamin

Y everyday. He also advises that these vitamins are available in two

tonics A and B. Each unit of tonic A consists of 2 units of vitamin X and 3

units of vitamin Y. Each unit of tonic B consists of 4 units of vitamin X and

2 units of vitamin Y. Tonic A and Bare available in the medical shop at a

cost of ETB 3 per unit of A and ETB 2.50 per unit of B. The patient has to

fulfill the need of vitamin by consuming A and B at a minimum cost.

• If we solve and get the solution of the primal problem, we can read the answer of
dual problem from the primal solution.

Primal problem: Dual Problem:

Min C= 3X1+ 2.5X2 Max Z= 40Y1+ 50Y2

st: 2X1+ 4X2 ≥40 St: 2y1+ 3y2 ≤3

3X1+ 2X2 ≥50 4y2+ 2y2 ≤2.50

X1, X2≥0 Y1, Y2 ≥0.

 Solution to primal (minimization)
CJ 3 2.5 0 0 M M
Zj Bv Q X1 X2 S1 S2 A1 A2
2.5 X2 5/2 0 1 -3/8 1/4 3/8 -1/4
3 X1 15 1 0 1/4 -1/2 -1/4 1/2
Zj 51.25 3 2.5 -3/16 -7/8 3/16 7/8
Cj-Zj 0 0 3/16 7/8 M-3/16 M-7/8
Answer: X1= 15 X2= 2.5 cost= 51.25

Solution to dual (maximization)

CJ 40 50 0 0
Zj Bv Q Y1 Y2 S1 S2
50 Y2 7/8 0 1 1/2 -1/4
40 Y1 3/16 1 0 -1/4 3/8
Zj 51.25 3 2.5 15 5/8
Cj-Zj 0 0 -15 -5/2

Answer: Y1= 3/16 Y2= 7/8 profit= 51.25

• The patient has to minimize the cost by purchasing vitamin X and Y and the shopkeeper
has to increase his returns by fixing competitive prices for vitamin X and Y. Minimum cost
for patient is ETB 51.25 and the maximum returns for the shopkeeper is ETB 51.25. The
competitive price for tonics is ETB 3 and ETB 2.50. Here we can understand the concept
of shadow price or economic worth of Resources clearly. If we multiply the original
elements on the right hand side of the constraints with the net evaluation elements
under slack or surplus variables we get the values equal to the minimum cost of
minimization problem or maximum profit of the maximization problem.
 ?
Sources:
1. Taylor III (2006)
2. Anderson et al., (2014)
3. Murthy (2007)
4. Others